AMSC Shareholder/Stockholder Letter Transcript:
AMSC Stockholders,
In fiscal year 2023, AMSC delivered terrific operational
performance, the culmination of our efforts to build a more
diversified and financially stronger company. AMSC delivered
outstanding operational performance with three consecutive
quarters of non-GAAP net income and operating cash flow;
expanded gross margins dramatically versus a year ago and
ended the year with over $90 million in cash. The strength of
our balance sheet is critical to support larger orders and
presents opportunities for further business growth.
Our financial performance was remarkable. We saw total
revenue grow over 35% to nearly $146 million dollars in fiscal
year 2023. Wind revenue increased by more than 100%, while
Grid revenue grew by nearly 30%, in both cases versus the
year ago period. We reported non-GAAP net income and
positive operating cash flow for the fiscal year. We booked on
average over $37 million of new orders per quarter during
fiscal year 2023, and our robust twelve-month backlog stands
at $140 million at the end of March 2024.
We saw diverse revenue in renewable, industrial, mining, Navy
projects and semiconductors. About one third of our sales in
fiscal year 2023 were to renewable projects while another
quarter was from industrials. Metals, mining, and materials
projects were over 15%, the Navy was above 10% and
semiconductor projects accounted for nearly 10% of total
revenues.
Our orders for the power grid include the U.S. military
resiliency markets, a new market in which we provide efficient
and reliable shore power to naval vessels. These orders serving
the U.S. military represent an exciting new opportunity for
AMSC s new energy power systems. We reached nearly
$20 million in total military revenue, which includes both ship
protection and new energy power systems revenue.
For another consecutive year, AMSC achieved strong gains in
the military market. We have a total of five Ship Protection
Systems, or SPS, for the San Antonio Class platform. We
successfully delivered and tested the first ship protection
system, which is now operating on the ship. We delivered our
second ship protection system and are currently delivering the
third.
Furthermore, in fiscal year 2023 we announced our proprietary
High-Temperature Superconductor Mine Countermeasure (or
MCM) system to be designed, built, integrated, and deployed
on the U.S. Navy s Mine Countermeasure-Unmanned Service
Vehicle. This is a capability that is incorporated into an
unmanned service vehicle and launched during mine
countermeasure operations that patrol for and neutralize
mines.
Most recently, in June 2024, we announced the expansion of
our SPS to an allied navy with a $75 million dollar contract for
multiple Canadian Surface Combatants. This contract award
marks the first AMSC Ship Protection production systems
delivery to an allied navy and represents the success of the very
deliberate actions we have taken to diversify our business,
drive growth and expand scale both domestically and
internationally.
Our grid business is thriving. Our Resilient Electric Grid system
in Chicago has performed as planned and has become a
showcase for the technology. Currently, we are in discussions
with several utilities about possible future projects.
Additionally, in our wind business we more than doubled our
year-over-year growth as Inox business prospects demonstrate
improvement and our 3-megawatt ECS demonstrates its
capabilities. In fiscal year 2023, we secured nearly $15 million
of 2-megawatt wind turbine ECS demand from INOX. We also
announced an initial 3-megawatt class wind turbine ECS order
of $5 million dollars, followed by an additional $8 million
dollar order. We shipped most of the ordered 2MW and 3MW
ECS systems against these orders during fiscal year 2023. We
completed type certification for the 3 MW class wind turbine.
The 3MW class wind turbine is now operating in the field and
is expected to drive additional customer demand. We are
supporting Inox s growth through our proprietary technology
that can enable our partner to deliver superior products to the
marketplace.
We believe our company s diverse bookings, strengthened
balance sheet, and operational success in fiscal year 2023 have
laid the groundwork for AMSC s long term growth. We are
optimistic our business may benefit from the investments in
our key growth markets: renewables, mining and metals,
semiconductors, and military.
The business is in the best position in more than a decade and
continues to improve!
Our transformative power solutions are helping to move the
world forward. We are executing on our vision and believe that
our creativity can meet today s challenges and help us progress
to a better future. This means using future-facing technologies
to harmonize the world s desire for decarbonization and clean
energy with the need for more reliable, effective, and efficient
power delivery. We are committed to powering progress by
designing, developing, and deploying power control solutions
that harmonize an increasingly complex energy system.
We have tremendous opportunities ahead of us. I am
immensely proud of our team as we continue to serve our
customers, shareholders, and markets.
I look forward to reporting to you again next year on AMSC s
bright future.
Daniel Patrick McGahn
Chairman, President and Chief Executive Officer
6/20/2024 Letter Continued (Full PDF)